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This is econ 101: when a family is richer, its older workers demand higher wages to stay in work and its younger workers demand higher wages to take a first job. The dynamic contracts available jobs unless offset by an equal or greater rise in productivity.
— Edmund Phelps, Financial Times 11 January 2012, 2006 Nobel Laureate in Economics

Late in last week’s article I used an archaic word, which at the time I had not noticed. But shortly thereafter, I wondered if any American still understood what I was writing about and even if they had an inkling of its meaning, if they could at all grasp the implications of what that word, if really put into practice, would actually do to the economic muddle we now find ourselves. Dear readers that word we don’t hear anywhere anymore is: decentralization.

In my lifetime the United States of America, has become really the federal government unitasker of the world and its current and potential prosperity. There was some talk within the early days of the Tea Party and the talking points of Republican candidates for the presidency, about states rights; and of course Ron Paul and his libertarian base speak of smaller government and in favor of individual rights, sometimes bordering on anarchy. The word decentralization however is to be found nowhere in anybody’s conservative lexicon.

As far as Barack Obama, the liberal-progressive-left and the Democrat Party, it seems that they think there is no problem that more government spending will not cure, particularly if it originates within the federal government unitasker, an then forces the un-sovereign states to fund what the federal government doesn’t have the political will or the constitutional power to implement.

Furthermore, like all elitists of their persuasion, they believe that new wealth can be created, as do most Republicans, through tax incentives to crony capitalists, which through mergers and acquisitions, will provide the economic basis for the continuing growth of government programs, including entitlement programs and wealth redistribution.

Late Sunday we posted a short video from CNBC last Friday with Edmund Phelps, whose quotation above, from a recent article in the Financial Times, begins our discussion this week. In that video he speaks of the role of particularly southern European governments who sponsored wealth creation for their citizens through entitlement programs, yet through unintended consequences are linked to both a decline in national productivity as well as a significant cause of the euro crisis.

Tags: economics, Edmund Phelps, productivity, wealth, efficiency, USA, liquidity, Business Ecology, Great Depression, Collectivist Elitists, Laissez Faire Scoundrels

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Neither a borrower nor a lender be,
For loan oft loses both itself and friend
And borrowing dulls the edge of husbandry.
— Polonius, Hamlet Act 1, scene 3, 75-77

Well shucky darn and slop the chickens!

It seems Friday’s long sought solution to the European debt crisis is just another in the series of now over used “kicking the can down the road, (until it is kicked off the cliff) metaphor is back. The whole shebang lasted over the weekend. Thankfully we have the French to praise for the five-day workweek, for God only knows what would have happened without that break.

But at least the Eurocrat elites are hard at work at their misadventure, the American federal government’s political class, both the President and the Congress, seem to like their adventure into the lazy-fairy world of the historic continental work ethic.

At Wonder Springs we have no hesitation to say that on both sides of the Atlantic, the elitists across the political and economic spectrums, seem immersed in trying to create a new and better Babylon, ignoring that Biblical story, as not even a myth, but a children’s boogie-man piece of fiction.

We are beginning another winter, like in the C. S. Lewis’ Narnia Wardrobe tale, “where it is always winter, but never Christmas” which is playing out in reality for far too many subjects, or serfs, or peasants, or lowly evolved talking animals. This is occurring within the grand scheme to make a world of prosperity, based upon a faux world of finance, completely divorced from nature and natural law.

So to cut this string of allegory and metaphor, we shall exit, stage right, with a Palin: How’s that hopey changey, thing workin’ out for ya!

Tags: finance, Babylon, jobs, C. S. Lewis, risk, Collectivist Elitists, Laissez Faire Scoundrels, Entrepreneurial Pioneer Area, Business Ecology

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“If you don’t fundamentally change structure and culture, you are doomed to repeat history.”
— Diane Vaughn, Columbia University; Author: The Challenger Launch Decision

Humans sure are religious creations. We all believe in something, or someone, even if some people say they believe in nothing; nothing must have its corporate headquarters in Nowhere.

I bring this up because here on the west coast, late tomorrow afternoon, president Obama is finally giving his speech on saving the continuing to tank economy — just before the kickoff of the NFL season. I’m sure, just another teleprompter speech will be the talk around the water coolers and the coffee pots, as those who have real jobs, bolster up their courage to meet the hassles of the daily commute home. So remember to set your DVRs!

It has to be some religious issue for Barack Obama, like someway his words are going to recreate reality. Most leaders would leak a 5, 7, or 10, or 12 point plan with all sorts of backup data and then make a few well chosen remarks about the high points, and let the analysts and the pundits have their way with the details. But not this president, this speech has been hyped for a month; at least it seems that way. The “Hallelujah, Thank you Barack!” seems to have lost its revivalist luster.

Adding some economic context, everyone pretty much knows that the speech will be essentially about the New-New Deal Keynesian stimulus, which will not be called stimulus, that will provide a mechanism to rebuild twentieth century infrastructure, and to provide prevailing wage union jobs to bring it about, once all the regulatory hurdles are jumped and moats are crossed. But wait, that moat must be a wetland; so one could foresee a decade of moat crossing regulations that will need to be fill or fulfilled, before. . . — Wasn’t this supposed to be about creating jobs?

Rick Perry, the Republican party frontrunner, says and writes that he is FED UP! with the size of the Federal Government. Since growing federalism has been around for 150 years, and has become more “progressive” as time has elapsed, that sounds a whole lot like “hope in change” with just a slightly different religious spin.

Personally it seems that, “How’s that Hopey-Changey Thing Workin’ Out for Ya?” appears to be, “That same-ol’, same ol’ isn’t workin’ either!”

Tags: Barack Obama, Rick Perry, Grizzly USA, Business Ecology, Climax Ecosystem, GDP, Great Depression, Entrepreneurial Pioneer Area